My interview with the former chief economist at Bear Stearns, David Malpass (President of Encima Global), centered on the importance of small businesses and the state of the US economy. Recognized but under-appreciated by most investors, the engine of job creation in the US is far from healthy. While big and sound businesses have had their access to capital restored and have business models centered on the global markets (which is where the growth is), small and mid sized businesses in the US do not enjoy such good fortune. And while some might argue that the process the global economy is going through is a form of creative destruction, David astutely points out that bankers' quest for safe investments runs the risk of cutting into the muscle of the economy - not to mention the role such credit starvation will play in the stagnation of wage growth and employment. With an national election on the calendar next year (and the Democrats poised to take a mid term beating), the political dimension to this issue will almost certainly take center stage.

The investment strategy implications are not just in the broad macro economic sense. In tomorrow's commentary I will elaborate on this point. Until then, I encourage you to give the 14 minutes 8 second informative and insightful interview a listen (or two).

Vinny Catalano, CFA, Global Investment Strategist with Blue Marble Research publishes the "Sectors and Styles Strategy Report" newsletter, which contains the market beating Model Growth Portfolio. To learn about subscribing as well as other benefits,  click here.